HOUSING Minister Dr Omar Davies has indicated that the 262 depositors who have kept faith in the Housing Agency of Jamaica’s (HAJ) Bernard Lodge Estate housing scheme will be rewarded with their homes by next March.

In addition, he said that the Housing Agency of Jamaica (HAJ) — the Government entity involved in the Public/Private Partnership Agreement (PPPA) for the project, which has stalled since its announcement in May, 2013 — will realise some US$4 million, less 50 per cent of the value of the work previously performed, from the project.

“Let me express my appreciation to the 262 depositors who have demonstrated their faith in the Government’s commitment and have not requested a refund of approximately $113 million that they have deposited with the HAJ,” Dr Davis told the House of Representatives in a statement on Tuesday.

“I want to again assure them that their funds are safe and are being held in an escrow account by the HAJ,” he added.

Cabinet endorsed the construction of 604 one-bedroom units and 980 studio units, with associated infrastructure, on the approximately 295 acres of land left over from the construction of Highway 2000 in Bernard Lodge, St Catherine.

The project was announced as a public/private partnership between the Ministry of Transport, Works and Housing and foreign developer, Malphrus International.

Making the announcement then, Minister without Portfolio in the ministry, Dr Morais Guy said that it would be the largest project undertaken by the HAJ, and would be financed and constructed by foreign developer, Malprhus, with a capital outlay of approximately $5.6 billion to be expended over three years.

The cost of the units were listed as $4 million for the studios and $4.9 million for the one bedrooms and the project should have started in August 2013 and completed by April, 2014.

But almost two years after the announcement, depositors, who had paid down between $400,000 and $490, 000 on the studios and one-bedrooms, respectively, are yet to acquire their homes. The delay was originally blamed on the developer’s failure to get an agreement from Trans-Jamaican Highway, operators of Highway 2000 for the construction of storm water drainage across the throughfare. Malphrus then lost confidence in the deal.

Dr Davis told the House Tuesday that Cabinet has given the go ahead for the signing of another PPPA with a new company, Herzog Jamaica Limited, and termination of the previous agreement with Malphrus. The project will now be financed by Herzog’s parent company, Herzog Contracting Corporation.

He said that the prices of the homes would be adjusted to a maximum of five per cent for each phase.

Dr Davies said that Herzog has given an undertaking to enter into an indemnity agreement with Malphrus, waiving any claims relating to, and arising from, the PPPA for the project.

He said that 2.5 per cent of the sale price of each unit of Phase One shall be deposited into an escrow account, to be paid to the HAJ, in the event that the developer fails to perform.

He also stated that, in the event that payment in full for a particular unit has not been deposited into the escrow account within 120 days after completion of the phase, the developer shall have the option to take the title for the unit and the land on which it sits.

— Balford Henry